Chapter 7 Bankruptcy Laws
60The
chapter 7 bankruptcy laws are reserved for those wanting to file bankruptcy,
and are often used to petition the court when a borrower does not have the
means necessary to pay off the exorbitant amount of debt they have accumulated.
With these laws, a trustee is permitted to retain a portion of the debtor's
property to secure the payment and unless creditors are taking action related
to a particular lien, they can in no way attempt to collect any further
payments from the debtor. Debtors that are facing excessive credit card debt or
medical expenses are the most common petitioners for chapter 7 bankruptcy.
When a debtor files a petition for bankruptcy under the protection of the
chapter 7 bankruptcy laws, an injunction, designed to prevent creditors from
collecting any further payments, is passed once a case number has been
assigned. In this process, known as an automatic stay, the administrative
trustee's office will hand the case over to a trustee after thirty days. The
trustee's job is to liquidate any assets that the debtor may have, collecting
as much money as possible to pay off creditors according to the priority in
which they should be paid. The trustee obtains detailed information on the
debtor and maintains a record of all activities, reporting any suspicions of
fraudulent motives or methods, before determining if a debtor is liable for
their debts or not.
Some
property, kept as a lien, can serve as an exemption for a certain amount of
debt, the value of which will be determined by an attorney who can also suggest
which assets may be best given to a trustee that can collect an appropriate
amount for the lien. Once the debtor and trustee have an opportunity to meet
and the trustee has reached a decision regarding the individual's assets, sixty
days must pass before creditors can file their complaint. Within thirty days of
meeting with a debtor, the trustee must file the debtor's objections regarding
any exemptions that may be involved. Under certain circumstances, any
objections made by the creditor will be followed up by a trail, which is best
managed with the aid of an attorney that can advise the individual
appropriately.
Most of the time, cases falling under the protection of chapter 7 bankruptcy
laws face few objections and are quickly discharged, but there are some
instances in which the debts may not be discharged as easily, and an attorney
can help to counsel an individual on which of these debts may be problematic.
President Bush has passed a new bankruptcy law that may cause many of the
chapter 7 bankruptcy laws to change, narrowing down the types of debts that a
debtor can claim under chapter 7 bankruptcy, in turn making it difficult for
them to file a case. Federal courts now determine if a case can be filed under
chapter 7 bankruptcy laws and if not, they will decide which chapter if any,
the case can be filed under.
If you’re looking for more chapter 7 bankruptcy information or you’re looking
for a chapter 7 bankruptcy lawyer, the internet is a wonderful resource that
can provide you with many answers.
Related Hubs:
Avoiding Bankruptcy
Bankruptcy Options
Car Loan After Bankruptcy
